Wind Energy's Effect on School Finances and Student Outcomes

March 26, 2021


Wind energy has grown tremendously in the United States in recent years—installed capacity today is more than 50 times what it was in 1995. Most states tax the property on which wind turbines sit, and some of that money flows to school districts. But how much, and what is the impact? A new Berkeley Lab study, School District Revenue Shocks, Resource Allocations, and Student Achievement: Evidence from the Universe of U.S. Wind Energy Installations, examines the impact of wind energy installations on school district finances and student outcomes using data on the timing, location, and capacity of U.S. installations from 1995 through 2016 across 35 states.

The authors find wind energy installations led to large increases in local revenues to school districts, with only minimal offsetting reductions in state aid. Schools dramatically increased capital outlays but only modestly increased current operational spending, such as teacher salaries and. Accordingly, they find little to no change in class sizes or teacher salaries, nor student test scores.

They theorize that state- and county-level tax laws direct most school district funds toward capital projects and away from the current expenditures. If states or counties wish to prioritize student achievement improvements, tax policies will likely need to be reimagined to encourage greater current expenditure proportions. Finally, the study also finds some evidence of tax relief in response to additional wind revenues, which might benefit all district residents.

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